Progress Energy 2007 Annual Report Download - page 100

Download and view the complete annual report

Please find page 100 of the 2007 Progress Energy annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 140

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
98
The total fair value of restricted stock awards vested
during the years ended December 31, 2007, 2006 and 2005
was $13 million, $4 million and $7 million, respectively.
Cash expended to purchase shares for the restricted
stock program totaled $8 million during the years ended
December 31, 2006 and 2005, respectively. Cash expended
to purchase shares for 2007 was not significant due to the
curtailment of the RSA program and the rollout of the new
restricted stock unit (RSU) program.
Beginning in 2007, we began issuing RSUs rather than
restricted stock awards for our officers, vice presidents,
managers, and key employees. RSUs awarded to eligible
employees are generally subject to either three- or five-
year cliff vesting or five-year graded vesting. Compensation
expense, which is based on the fair value of common
stock at the grant date, is recognized over the applicable
vesting period, with corresponding increases in common
stock equity. RSUs are not included as shares outstanding
in the basic earnings per share calculation until shares
are no longer forfeitable. Units are converted to shares
upon vesting. A summary of the status of nonvested RSUs
at December 31, 2007, and changes during the year then
ended, is presented below:
The total fair value of RSUs vested during the year
ended December 31, 2007, was $3 million. There were
no expenditures to purchase stock to satisfy RSU plan
obligations in 2007.
Our Consolidated Statements of Income included total
recognized expense for other stock-based compensation
plans of $70 million for the year ended December 31, 2007,
with a recognized tax benefit of $27 million. The total
expense recognized on our Consolidated Statements
of Income for other stock-based compensation plans
was $25 million with a recognized tax benefit of
$10 million and $10 million, with a recognized tax benefit of
$4 million, for the years ended December 31, 2006 and
2005, respectively. No compensation cost related to other
stock-based compensation plans was capitalized.
At December 31, 2007, there was $51 million of total
unrecognized compensation cost related to nonvested
other stock-based compensation plan awards, which
is expected to be recognized over a weighted-average
period of 1.8 years.
C. Earnings per Common Share
Basic earnings per common share are based on the
weighted-average number of common shares outstanding.
Diluted earnings per share include the effects of the
nonvested portion of restricted stock, restricted stock unit
awards and performance share awards and the effect of
stock options outstanding.
A reconciliation of the weighted-average number
of common shares outstanding for the years ended
December 31 for basic and dilutive purposes follows:
There were no adjustments to net income or to income
from continuing operations between the calculations of
basic and fully diluted earnings per common share. ESOP
shares that have not been committed to be released to
participants’ accounts are not considered outstanding
for the determination of earnings per common share. The
weighted-average shares totaled 1.8 million, 2.4 million
and 3.0 million for the years ended December 31, 2007,
2006 and 2005, respectively. There were 0.1 million,
1.8 million and 2.9 million stock options outstanding at
December 31, 2007, 2006 and 2005, respectively, which
were not included in the weighted-average number of
shares for computing the fully diluted earnings per share
because they were antidilutive.
D. Accumulated Other Comprehensive Loss
Components of accumulated other comprehensive loss,
net of tax, at December 31 were as follows:
(in millions) 2007 2006 2005
Weighted-average common shares – basic 256.1 250.4 246.6
Net effect of dilutive stock-based
compensation plans 0.6 0.4 0.4
Weighted-average shares – fully diluted 256.7 250.8 247.0
(in millions) 2007 2006
Loss on cash flow hedges $(23) $(14)
Pension and other postretirement benefits (13) (39)
Other 24
Total accumulated other comprehensive loss $(34) $(49)
Number of
Restricted Units
Weighted-Average
Grant Date Fair Value
Beginning balance –$–
Granted 913,282 50.33
Vested (49,430) 50.70
Forfeited (39,394) 50.70
Ending balance 824,458 $50.29
Number of
Restricted Shares
Weighted-Average
Grant Date Fair Value
Beginning balance 604,238 $43.82
Granted 7,000 49.54
Vested (303,935) 44.08
Forfeited (38,668) 43.16
Ending balance 268,635 $43.77